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Managing Innovation in Business

University: Bradford College

  • Unit No: 7
  • Level: High school
  • Pages: 13 / Words 3234
  • Paper Type: Assignment
  • Course Code: N/A
  • Downloads: 6496
Question :

This sample will guide us through:

  • Elaborating about innovation in business
  • Explaining Future of Retail Industry in 2020 and Beyond
  • Elaborating Tesco's Innovation
Answer :
Organization Selected : Tesco's


Innovation refers to practices and procedures that are related with modifying existing offerings of an organisation in order enhance their importance and value among customers (Acemoglu and et. al., 2018). This aspect relates with resolving unique and new requirements by implementing better solutions. The report below is based on Tesco Plc, which is one of the biggest merchandise and grocery retailers in the United Kingdom. The firm is widely recognised in the country and is one of the best performers with consistent improvements in their sales figure. According to in-depth analysis, the company is subjected to almost 2.2% increase in quarterly sales year-on-year (Tesco is best performing big supermarket in latest sales figures, 2018), The firm is continuing to strengthen its customer base domestically as well as internationally to retain its industrial position in retail industry of the UK. The purpose of this report is to perform in-depth analysis of the the future of retail industry in 2020 and beyond. The assignment will also evaluate Tesco's innovation requirements in the year 2020 and beyond. Along with this, an explanation and insight on the future innovation capabilities of Tesco will also be analysed.

Future of Retail Industry in 2020 and Beyond

The UK's retail industry has been subjected to a lot of innovations lately. Be it products or processes, the industry is witnessing major advancements in terms of technology. With easy and effective access to various advanced engineering equipments, this industry has been very contributing in relation to introducing innovations (Frow and et. al., 2015).

The retail sector in the UK is gearing up for a post-Brexit scenario to cope up with drastically changing customer behaviour. For 2020 and beyond, the industry has various trends which would further shape the technological facet of this industry. With ongoing digitalisation and enhancements in Information Technology, these trends include advancements in Robotics, Artificial Intelligence as well as Automations. The Future of this industry in 2020 and beyond is well indicated by various innovations which are mentioned below:

SmartShop and Scanning:

With digitalisation on the rise and further anticipated inclination of customers in Social Media and Smartphones, the retail sector is also shifting its operations online. There are various mobile applications like “SmartShop App” which allow customers to execute online retailing. For 2020 and beyond, Sainsbury's, which is one of the biggest market leaders in this sector, is planning to continue this trend. Along with this SmartShop, the company is planning to develop a technology which would completely eradicate the checkout procedure for customers. This new technology would allow customers to further use their smartphones to conduct their payment procedures for the products which they buy. However, currently this application under usage of many Sainsbury's customers, yet, the new technology would further up the game in terms of convenience for these buyers. The firm is relying on this effectively and with predictions of the firm regarding contactless payments reaching almost $2 trillion by 2020, Sainsbury's will be implementing this technology to enhance the convenience of its customers (Sainsbury's rolls out scan and pay tech, 2019).

Fibre-based Packaging:

With ongoing concerns of environment, the trend is likely to be followed by the masses in the year 2020 and beyond. The retail industry of the UK is focusing on implementing effective waste management technologies and further eco-friendly ways to preserve the natural resources. Innovative efforts are being made to effectively mitigate ways which degrade the environment. One such effort is being made by Waitrose. The organisation is planning to modify its products and packaging and ensuring glitter-free alternatives by 2020 (Waitrose targets glitter phase-out by 2020, 2018). The vision of firm for future beyond 2020 is to ensure completely environmental friendly practices. To achieve this, the firm is adopting fibre-based packaging across the company's Italian ready meals range. This is a sustainable innovation which ensures biodegradable materials to package the products. It is an opportunity for the industry in 2020 and beyond to preserve environment and attract more customers by such healthy manner and ensuring the safety of their well-being.

Artificial Intelligence:

The future of UK's retail industry is completely dependant upon advanced technology as a medium to enhance the business processes and to attract customers effectively. Within the industry, this technology has already started to penetrate deeper and more retailers are paving way for this technology to enhance their effectiveness. According to various estimates, more than 70% of retailers within the UK market are investing in AI for their future business practices beyond 2020. The agenda for companies to use AI is to enhance their productivity and ensure better customer management in their retail stores and supermarkets. In addition to this, customers are demanding more speed in their buying procedures and to effectively accomplish this, it is imperative that advanced technology be used by UK retailers in this market (AI in retail: Survey finds most UK retailers investing in AI customer service, 2019). This could serve as one of the biggest opportunity for the retail industry in the future beyond 2020 in relation to speed, service and safety. It would also be utilised to attract more customers by ensuring better management and effectiveness in their shopping processes.

Tesco's Innovation Requirements in 2020 and Beyond

The future of retail industry holds a wide scope for companies to stay ahead in the game of technology and improve the way they manage their businesses and ensure better customer acquisition and retention. Tesco is one of the biggest names in retail and with such effective performance through the years, it is imperative that the company ensures effective innovation in the future to retail its market position. It is required for the firm to implement processes and products that are technologically advanced in order to fulfil the market needs. Following are various innovation requirements for Tesco in 2020 and beyond:

Virtual Reality (VR) and Augmented Reality (AR):

Two of the most technologically advanced and recognised innovations in recent times are Virtual and Augmented Reality. These phenomena have been widely utilised by various retail organisation and in a way is shaping up retail industry as well. There are various retail companies which are relying heavily on usage of VR and AR concepts to attract their customers and effectively manage to provide more effective services to them in future. This trend is effective and will be growing in 2020 and beyond. Tesco could implement the same in their stores to allow customers to hand-pick their products without physically be available at the store, and make payments for the same later. This would provide convenience to buyers and Tesco could offer them an access to all of its wide-range products to its distant customers as well.

Robotics and Automation Systems:

One of the major innovations which could enhance further contribute in Tesco's success in the future is robotics. The firm has access to this technology and has been utilised on trial basis in 2017 when the firm made its first delivery by robot. It was witnessed for the first time in the UK market and made a mark of Tesco's capabilities (ROBOSHOP: Tesco makes UK’s first delivery by ROBOT in trial that could change shopping forever, 2018). The era after 2020 would completely be inclined towards fine use of technology and Robotics and Automation Systems could be used by the firm in their business processes which would increase its competence. The company could employ Robots within their online stores with preset functioning which would allow them to eradicate the possibility of human errors and training and development. This would also allow them to attract customers by ensuring spontaneous assistance and accurate information about the store and its products. In addition, robotics could also be used in parking facilities as well in terms of parking slips and on security checking and billing counters. Implementation of such innovation in business processes would allow the company to earn more customer and profit in 2020 and beyond.

Cognitive Computing:

One of the major future innovations that could be adopted by companies of retail industries in the UK is cognitive computing. This technology has the potential for Tesco to ensure customer's privacy protection and revenue enhancements. It could effectively use this advanced level of technology to reduce the complexity of their daily business processes (Cognitive Computing Opportunities that can Make E-commerce Better, 2018). By effectively implementing the same, the response of technological inputs within the company will be at par with humans. This is a future requirement that is needed by Tesco to achieve its future capabilities.

AI and customer insight:

Customer Management resources enable a company to manage each of their buyers and their buying patterns in a way which effectively ensure retail companies in gaining a better insight and provide aspects which lead to attraction of more customers. Beyond 2020, the retail market will be completely customer-centric and companies will be expected to function in a way in which they could fulfil diverse demands of these individuals. Customer management technologies could be a game changer for Tesco in relation to offering products according to their buying patterns. Within the UK market, customers prefer companies which uses Artificial Intelligence to better manage their buyers (How Tesco is using AI to gain customer insight, 2018). AI could aid the firm in several ways in building effective customer management in the future. It could be utilised by Tesco to track customer data which is essential to analyse the products which are favoured by them. AI could also allow them to develop strategies to give personalised services to these customers. In this manner, Tesco will be able to effectively manage each customers and build effective communication channels with each buyer to address their personal queries. This would also satisfy the innovation requirement of Tesco beyond 2020.

Building Future Innovation Capabilities for Tesco

It is essential for a company to give insight to various future requirements to develop strategies and modify its offerings in order to serve customers in a better way. Within the retail organisation, there are various customers with varied and diversified demands. It will be essential to fulfil these demands to effectively expand customer base and increase profitability. Innovation has always been the key for organisations to achieve sustainable growth in terms of products and processes. Tesco, within the UK retail industry has been a market leader for several years and is consistent with terms of innovation and performance. The company, in order to fulfil their future requirements must analyse their innovation capabilities and work on those to sustain and grow in the market. Innovations would also aid the firm's struggle to stay ahead of the competition with various other market leaders like Sainsbury's and Morrisons (Top 9 Tesco Competitors, 2019). To achieve this and effectively build the firm's innovation capabilities, Tesco is planning to use a road map. This strategy is used by companies to determine stages which are required to be fulfilled in order to implement innovation within their organisation. This strategy would provide an in-depth structure for Tesco to work upon and introduce various new innovations in their organisation. The road map for organisation to implement innovations is briefly discussed below:


The prime step of every road map is to determine the most appropriate type of innovation which could serve the firm for a foreseeable future. Beyond 2020, the UK retail sector is likely to incline more towards the use of technology and it is imperative that Tesco uses the very innovation that could aid it in building its capabilities and fulfil the innovation requirements of the market. For this, the most apt innovation for Tesco could be Robotics and Automation Systems.


After deciding the innovation and producing effective suggestions, it is imperative to back it up with strong and effective reasoning. It is a crucial step that decides whether the innovation is fulfilling the requirements or not. For Robotics and Automation Systems, there is a heavy reliance of the industry and market upon advanced technology and use of Artificial Intelligence to further enhance the outcome of their business processes and better customer management. This further enhances the demand for Tesco to adopt advanced technology to be implemented in their business processes and remove the possibility of ineffectiveness.

Impact of Change:

Modifications and changes are inevitable. These are required for a company to effectively survive within the market, especially in retail where there are high customer demand and fierce competition. There are various aspects which experience the impact of this change and are required to be effectively managed to ensure smooth implementation of innovation. For Robotics and Automation Systems, there are various areas within Tesco where the impact of this change would be the most. These areas are described below:

  • Research & Development: Major impacts of innovation are witnessed on a company's R&D department. Since Tesco is already affiliated with Robotics, its Research & Development sector will not be effected in a quite drastic way, however, the impact will be evident (Biemans, 2018). This is because this department will be required to research the ways in which Robotics and Automation Systems could be built, i.e., the resources that would be required as well as the individuals and organisations that would fulfil the skill gap require to develop and implement this system within the company. In addition, it also requires to analyse further modifications within the infrastructure of the company to support the manufacturing and distribution of these companies.
  • Resources: Implementation of innovations are linked with necessary resources that are required to be available with the firm to support the development of innovated offerings. For Tesco, the firm requires various different types of resources as existing resources might not fulfil the requirements seeing the advancements in technology from the time when the organisation first used robots for delivery. The required resources would be human resources, financial resources, AI software, mechanical equipments and automation technology as well as Robotic Locomotion Systems to assist the company in building Robotics and Automation Systems for the company (Exploring Robot Locomotion Systems, 2018).
  • Technical Skills: Another sector where the impact of change is witnessed is in the required technical skills. It is essential that a certain level of competence, skill and knowledge is possessed by the human resources to appropriately address each requirement needed to be in the innovation. For Robotics and Automation Systems, the company is required to be equipped with individuals who are affiliated with AI and Robotics and have effective knowledge about programming languages, mechanical tool maintenance, arithmetic principles, physics and advanced automation systems (Robotics Technician Career, 2018).
  • Legal Aspects: Another impact of change for any company on its verge to introduce innovation are compliance with the legal laws. These legal requirements are very crucial for any company to abide by effectively in order to ensure government support in their project. For Robotics and Automation Systems, the firm requires the company to effectively comply with Employment and Labour Law, 2018 stating various norms regarding the management of human resources within the company (Intellectual Property, 2018). The firm requires this to effectively manage their employees in the most productive manner. Another type of legal aspect which would be experiencing the impact of change are the intellectual properties which are required be protected by the firm to ensure effective proper and appropriate safety of the unique efforts of firm's employees (Employment & Labour Law 2018, 2018).
  • Cost of Change: For any change, it is essential for a firm to effectively analyse the financial requirement for innovation which could be a contributing factor in deciding its performance. It requires a company to gain an effective insight on each aspect associated with the innovation to determine the cost of its development and implementation.


After determination of impact, the next stage requires them determine the feasibility of the project. It is very important to anticipate the future of the process and its contribution to satisfy the motive of introducing innovation in the first place. The future requires the company to develop processes which ease the complexity of processes and appropriate customer management. In addition to this, it would further mitigate the unnecessary cost additions for the firm in future in regards with training and development of new employees. Hence, Robotics and Automation Systems would be very much feasible for Tesco to be implemented in future.

Approval Process:

Perhaps the most crucial stage of the road map, it is imperative for managers at Tesco to get approval of this innovation for further development. For this, the company is required to schedule formal meetings with the Board of Directors, further proposing the innovation of Robotics and Automation Systems describing all the aspects required to develop these systems and possible impact it would have on the company and its profitability in the future.

Application of Change:

After acquiring the necessary approval from the Board members, companies are required to effectively apply the change. This means, after the approval process, Tesco is required to develop Robotics and Automation Systems by channelising their resources towards structural and functional development of the same. It would require all the departments within the firm to effectively integrate each department into implementation of innovation within the firm into action.

Review of Change:

The final step of the road map requires companies to review the impact induced by their innovations to determine the usefulness and necessary alterations to further remove the limitations of the same and ensure maximum performance (Harhoff and Lakhani, 2016). Thus, it is necessary for Tesco to review Robotics and Automation Systems to determine the areas that needs further attention and working. Necessary alterations and modifications might be required to make these systems fully functional and operating at maximum efficiency for a long period of time without failing.


Thus, it is concluded that innovation is required within a company and in industry to effectively ensure accomplishment of current and anticipated future demands of the market. It is determined that businesses in retail industry are very much ahead and ready to implement future innovations. SmartShop and Scanning, Fibre-based Packaging and Artificial Intelligence are few of the most promising innovations that would further shape up the retail industry in the year 2020 and beyond. In addition to this, Virtual Reality (VR) and Augmented Reality, Robotics and Automation Systems, Cognitive Computing and AI and customer insight are various innovation requirements for businesses in retail industry. Lastly, a road map is effective to determine various stages which effectively assist businesses in implementation of innovation within organisations.


  • Acemoglu, D., and et. al., 2018. Innovation, reallocation, and growth. American Economic Review. 108(11). pp.3450-91.
  • Biemans, W., 2018. Managing innovation within networks. Routledge.
  • Frow, P., and et. al., 2015. Managing cocreation design: A strategic approach to innovation.British Journal of Management. 26(3). pp.463-483.
  • Harhoff, D. and Lakhani, K.R. Eds., 2016. Revolutionizing innovation: Users, communities, and open innovation. MIT Press.

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